Rusty Costanza / The Times-PicayuneThe facilities and engineering office, left, was built in the 1930's and will remain at Jackson Barracks. Next door, construction continues Wednesday on new building to house soldiers.

From the Arabi service station his father opened in 1927, Armand Serignan has watched neighboring Jackson Barracks slowly rise to life since Hurricane Katrina's tidal surge broke the levees and shut down the historic military installation nearly three years ago.

The massive construction project has provided a wealth of jobs to an economically down-trodden area and a bit of revenue for his small business, he said. But it is far from proving to be the catalyst state officials predicted when they announced that the new Jackson Barracks will renew Arabi and the Lower 9th Ward, he said.

"I'll be glad when that's finished," Serignan said Wednesday outside his business at St. Claude and Angela avenues, which was submersed in 9 1/2 feet of water and reopened five months later. "We're getting a few crumbs out of it but not as much as I thought."

Progress at the 100-acre installation at the Orleans-St. Bernard parish line is obvious. New below-ground utilities have long been installed, and armories and headquarters buildings tower over St. Claude and North Claiborne avenues. Inside, 16 buildings under six contracts totaling nearly $200 million are expected to meet their mandated January 2010 completion dates, said Lt. Col. Danny Bordelon, who oversees all National Guard construction south of Baton Rouge.

"Within 18 to 24 months, we should have significant operations there," said Maj. Gen. Hunt Downer, who largely is spearheading the reconstruction.

But pinpointing when Jackson Barracks will be fully operational again, allowing the area to feel its estimated annual $110 million economic impact, is elusive. The goal is to return the 700 troops that work there daily, and up to 3,500 soldiers and airmen who drill on weekends, Downer said.

New buildings are rising thanks to Defense Department's military construction funds. The Louisiana National Guard got almost $500 million for new facilities statewide in Katrina's wake. It is the largest construction budget in National Guard history, more than all the other states' and U.S. territories' allotments combined, Bordelon said.

Jackson Barracks is the largest of the statewide projects. Every building there was either damaged or destroyed during the storm.

Yet, the Guard is still wrangling with how it will pay for restoration projects not covered by military construction funds, from the military museum to Works Progress Administration buildings to the antebellum homes at an estimated to cost up to $40 million.

Widely considered the most significant collection of such buildings in the United States, the antebellum homes, which were built by the Army in the 1830s, overlook the Mississippi River. Homes to military families before the storm, they remain vacant.

FEMA will reimburse the state only $3 million to repair damage caused by Katrina, Downer said. But restoring buildings whose problems include years of termite damage will cost more than $20 million, he said. Even money to fully assess the project is not available.

The up side, Downer said, is that Katrina's destruction provided the Guard a chance to develop a master plan for rebuilding the installation, "to correct the error of our past with respect to planning." Through the decades, buildings were erected "in a hodgepodge fashion," filling land plots as needed, he said.

The new buildings adhere to Defense Department security requirements, including that they be blast-proof: Window glass is 3/4-inch thick. Historic details, such as galleries, were incorporated into design so that they mesh with the 19th century structures.

They're also designed using time-proven precedents for building in flood-prone areas, Bordelon said. Buildings have diesel-powered generators on upper floors, unlike the ones powered by natural gas before Katrina, whose surge swamped the place and trapped about 400 troops. Critical communications and other equipment are stored high.

"Every bottom floor here can be flooded, and we're still operational," said Bordelon, who nearly drowned there the day of the storm. "We're back to 200-year-ago construction."

The decision to rebuild Jackson Barracks and retain it for the state headquarters was a controversial one after the storm, Downer conceded. But it is economically important to the region, he said, citing the $110 million annual economic impact.

"We're big business," Downer said. "So it makes sense for us to rebuild and re-establish the Barracks as the headquarters."

Serignan holds out hope that more residents who live near Jackson Barracks, particularly those in St. Bernard Parish, will return, and that the installation will draw more people back.

"Once that's finished, it's going to be nice," he said. "It's going to dress up the neighborhood."

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Paul Purpura can be reached at ppurpura@timespicayune.com or 504.826.3791.